Oilfield Services Market revenue to reach USD 264.86 Billion by 2035, says Research Nester

Prominent oilfield services market players include Schlumberger Limited, Baker Hughes Company, Halliburton Energy Services, Inc., and NOV Inc.

New York, Aug. 02, 2023 (GLOBE NEWSWIRE) -- The global oilfield services market size is projected to expand at ~6.35% CAGR between 2023 and 2035. The market is expected to garner a revenue of USD 264.86 billion by the end of 2035, up from a revenue of ~USD 126.52 billion in the year 2022.The growth of the market is attributed to the increasing demand for oil. In 2022, when global oil consumption was projected to reach 98 million tons per day, growth slowed slightly to about 2 million tons per day. However, a further increase of around 3 mb/d is expected in 2023, mainly due to strong growth trends in non-OECD countries. Therefore, oil production is expected to continue growing, which will further boost the oil services market. In addition, two other important aspects, such as the reduction in oil service prices and the increase in production, have also boosted the global industry.

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Major upstream service providers offer a variety of customized packages that can save operators millions of dollars. In addition, the increased use of hydraulic fracturing and other stimulation techniques for shale gas production is expected to support the oilfield service sector as well. According to the United States Energy Information Administration (EIA), the amount of dry natural gas produced from shale formations in the United States in 2022 was about 28.5 trillion cubic feet (Tcf), or 80% of all dry natural gas produced in the country this year.

Oilfield Services Market: Key Takeaways

  • Market in North America to propel highest growth
  • The onshore segment to garner the highest growth
  • Market in Asia Pacific to grow at a highest rate

Increasing Number of Aircraft across the Globe to Boost Market Growth

It is estimated that the general aviation fleet in the United States will have approximately 204,404 aircraft in 2021, an increase from the previous year. Therefore, it is estimated that the demand for kerosene will increase. To produce aviation fuel that meets specific military or industrial requirements, various crude oil distillation products are commonly blended and refined into naphtha, gasoline, or kerosene. A reduction in excise duty of about USD 0.9 per liter for gasoline and about USD 0 per .076 per liter of diesel in India was announced by the government on May 21, 2022. Therefore, it is estimated that the demand for gasoline and diesel will increase. Additionally, in September 2021, the Indian government approved oil and gas projects in north-eastern India totaling around USD 12 billion. These projects should be completed by 2025. Nearly around 17 billion barrels of recoverable oil equivalent (Bboe) have been found worldwide by the end of November 2022 from about 177 wild new field drilling discoveries.31.7% of total household energy consumption in the EU in 2020 came from natural gas.

Furnaces, stoves, and space heaters use natural gas to heat people's homes. Therefore, it is estimated that as the need for energy to heat the home increases, the need for natural gas will also increase. This is estimated to influence the growth of the market even more.

Oilfield Services Market: Regional Overview

The market is segmented into five major regions including North America, Europe, Asia Pacific, Latin America, and the Middle East and Africa region.

Expanding government initiatives in the Oil Industry to Drive the Market Growth in North America Region

The oilfield services market in North America region is estimated to garner the largest revenue by the end of 2035. North American oil and gas projects are becoming more competitive due to higher efficiencies and tighter supply chains coupled with increased government initiatives in the oil and gas sector, further driving market growth. This has reduced drilling costs and many projects are now feasible. Fracking, horizontal drilling and the recent emergence of shale fields have contributed to a sharp increase in demand for oilfield services in the United States region.

In addition, increasing crude oil exports from this region are also expected to boost the market. Producing approximately 3 million barrels per day (mb/d) of crude oil in the year 2018, Canada is a major supplier of safe and reliable crude oil to world markets. Only Saudi Arabia and Venezuela have more oil reserves than Canada, which is one of the world's top oil producers. Proven oil reserves in Canada are approximately 167 billion barrels, of which approximately 163 billion are tar sands.

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Growing demand for state-of-the-art technology to Propel the Growth in the Asia Pacific Region

The Asia Pacific oilfield services market is estimated to garner the highest CAGR by the end of 2035. The Asia Pacific market is expected to be driven by factors such as increased demand for state-of-the-art technology, tools and equipment to increase the efficiency of onshore and marine exploration and production activities. However, there has always been high demand for oil and gas, which has driven offshore development in Australia, Malaysia and Indonesia. Therefore, it is considered that this would represent a market opportunity during the forecast period.

Additionally, China is the largest oilfield services market in the region, which also includes oil and gas storage services. The country has started using its shale gas reserves to meet domestic demand and plans to reduce its reliance on natural gas imports. In addition, new reforms in the oil and gas sector are expected to facilitate investment by private companies in the region, which is expected to help reduce the monopoly of state-owned companies.

Oilfield Services, Segmentation by Application

  • Onshore
  • Offshore

Amongst these segments, the onshore segment in oilfield services market is anticipated to hold the largest share over the forecast period. The segment's growth is driven by increasing onshore oil and gas exploration and production. Projections suggest that by 2025, offshore production will account for about 27% of global crude oil production, while onshore production will account for the remaining about 73%. Therefore, this segment is expected to see the highest growth as the onshore production method brings great benefits to the oil and gas sector.

In addition, offshore drilling poses several environmental hazards. However, onshore fracking has some environmental disadvantages, but the oil and gas industry is taking action at onshore sites to help protect the local environment where oil and natural gas production takes place. In addition, onshore drilling utilizes locally available shale as well as other resources that make drilling sites flexible and mobile, such as skids that allow equipment to be easily transported from one site to another. This reduces installation and transport costs, which would otherwise be significantly higher in an offshore project.

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Oilfield Services, Segmentation by Service

  • Geophysical
  • Drilling
  • Completion & Workover
  • Production
  • Processing & Separation

Amongst these five segments, the drilling segment in oilfield services market is anticipated to hold a significant share over the forecast period. The rising population and industrialization drive the demand for energy, including oil and gas. According to the International Energy Agency (IEA), global energy demand is projected to increase by 25% between 2019 and 2040. As oil and gas reserves deplete in mature fields, exploration and production activities are being conducted in new and remote locations, including deep water and unconventional resources. This drives the demand for drilling services. Advancements in drilling technologies have made it possible to extract oil and gas from challenging environments, such as ultra-deepwater, shale formations, and arctic regions. These technologies include horizontal drilling, hydraulic fracturing, and advanced drilling equipment.

The implementation of advanced technologies improves drilling efficiency and increases production rates. Offshore drilling plays a significant role in the oilfield services market. Offshore reserves are often larger than onshore reserves, and technological advancements have enabled the exploration and production of deep-water and ultra-deepwater resources.

Oilfield Services, Segmentation by Type

  • Equipment Rental
  • Field Operation
  • Analytical Services

Few of the well-known market leaders in the oilfield services market that are profiled by Research Nester are Schlumberger Limited, Baker Hughes Company, Halliburton Energy Services, Inc., NOV Inc., and other key market players.

Recent Development in the Market

  • To demonstrate its commitment to the Kingdom of Saudi Arabia, Baker Hughes Company, a GE company, announced plans to build a state-of-the-art Oilfield Services (OFS) facility at King Salman Energy Park (SPARK). Drilling Services, Fixed Line Services and Pressure Pumps are three OFS product lines expected to support the new facility, ensuring quality service delivery and preparing BHGE for future expansions in the region.
  • To begin work on the Engineering, Procurement and Construction (EPC) Agreement with the Assiut National Oil Processing Company (ANOPC) for the construction of the new hydrocracking complex for the Assiut refineries in Egypt, TechnipFMC plc has the last Conditions successfully met. necessary.

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